Former AHS CEO launches suit against Alberta

EDMONTON – The former chief executive of Alberta’s health authority is suing her former employer and health minister Adriana LaGrange, arguing in documents filed in court that she was terminated “capriciously, arbitrarily, and in bad faith” despite carrying out her duties.

The government dismissed Athana Mentzelopoulos (pictured) as CEO of Alberta Health Services (AHS) on Jan. 8, two days before she was set to meet with the Auditor-General to discuss her investigation into procurement contracts and deals for private surgical facilities, The Globe and Mail reported last week. She alleges that government officials, including Premier Danielle Smith’s then-chief of staff, interfered in AHS contract negotiations.

Ms. Mentzelopoulos alleges in her statement of claim that she was fired because of her internal investigation and a forensic audit that she contracted to a law firm.

The government has said that her dismissal was part of its planned restructuring at AHS and that the chief executive failed to provide “substantive information and documentation” that would back up her concerns despite the health minister requesting it for eight months.

The former chief executive alleges that she repeatedly spoke with high-level officials, including Ms. LaGrange, about her concerns. She had only completed one year of her four-year contract at the time of her termination and is now seeking $1.7-million in damages for breach of contract.

“The so-called repeated requests for information apparently by ‘the government’ never happened, and the first official request for information came on or about December 9, 2024,” reads the claim, which was filed in the Court of King’s Bench of Alberta. “Mentzelopoulos made all reasonable efforts to keep Minister LaGrange and Alberta Health updated as the investigations progressed.”

Ms. Mentzelopoulos alleges in the lawsuit that the first time she discussed her concerns with Ms. LaGrange was on Sept. 16 at a private dinner, two weeks after commencing an internal review into a contract with Alberta Surgical Group, a chartered surgical facility (CSF). Ms. Mentzelopoulos alleges she faced pressure, including by the Premier’s then-chief of staff, Marshall Smith, to sign an extension for ASG despite concerns of “significantly increased costs” compared to other contractors.

On Jan. 7, she alleges that Ms. LaGrange met with the AHS board and demanded they terminate Ms. Mentzelopoulos but the board refused. The next day, Andre Tremblay, the deputy health minister who took over as AHS CEO, terminated her employment “at the behest and direction of Minister LaGrange,” the lawsuit says.

None of the allegations in the lawsuit have been tested in court.

Ms. LaGrange, in a statement, said she has reviewed the statement of claim and intends to file a statement of defense in short order. She said changes to AHS’s leadership had nothing to do with investigations into CSF or other procurement.

“Upon initial review, many of the allegations and claims made are clearly false, while others will need to be investigated further as part of the Auditor General’s work and the government’s internal review of this matter,” she said.

The Premier said she first became aware of allegations that government officials interfered in contract negotiations at the provincial health authority after The Globe published allegations contained in a letter from Ms. Mentzelopoulos’s lawyer to AHS on Jan. 20.

Ms. Mentzelopoulos alleges, in the claim, that the Premier’s office was aware of her concerns before then.

Ms. Smith told reporters she is pleased Alberta’s Auditor-General is examining the allegations and that her office has set up a shared system with the watchdog to swap information.

Auditor-general Doug Wylie last Thursday confirmed his office is examining procurement and contracting processes at AHS and Alberta Health. The probe is related to chartered surgical facilities – privately owned outfits that perform medical procedures at the expense of government, as part of the public healthcare system – as well as ibuprofen and acetaminophen, and COVID-19 personal protection equipment.

“We’re interested in hearing what the Auditor-General has to say. We’ve already set up a shared file, so that they can get all the documents that we have to see if there’s any wrongdoing,” Ms. Smith said. “If there’s any wrongdoing, we’d like to get to the bottom of it.

“And if there isn’t, we need to find out why AHS is standing in the way of chartered surgical centres.”

Ms. Smith added that she still had confidence in her health minister. The premier came to power on a promise to shake up AHS and the United Conservative government is in the process of dismantling the health authority and replacing it with four other organizations.

Marshall Smith, who is not related to the premier, did not acknowledge a request for comment. Ms. Mentzelopoulos has not commented.

Ms. Mentzelopoulos, in her lawsuit, alleges she first became concerned with procurement and contracting issues at AHS around September. She alleges her internal investigations, which included chartered surgical facilities, and a review of deals tied to MHCare, the company that imported generic children’s medication from Turkey, ramped up in the fall.

Greg Bentz, a lawyer for MHCare Medical Corp., in a statement said his client has no comment “on a private dispute between two litigants that is currently before the courts.”

Source: The Globe & Mail